Method for Creating Securities and an Interim Options Exchange for Sporting Competition Outcomes

ABSTRACT

A method of commerce including ecommerce that combines sports betting and a securities market exchange. Options are created that represent a wager that a chosen team will win a specific competition or at least beat the spread. Equally priced options are exchanged for a ticket value between registered account holders through a website Controller before the start of a sporting competition. The Controller ceases formation of options before the start of the sporting competition. Registered account holder may buy and sell tickets to each other before and during the competition. Valuation of ticket prices fluctuates after the start of the competition and is established by a sports-specific formula, a market value proscribed by each ticket holder, a counteroffer proffered by an interested buyer, or a combination thereof. The Controller extracts a transaction fee for any or all sales and/or transactions.

CROSS REFERENCE TO RELATED APPLICATIONS

The present nonprovisional application depends from provisional application 61/571,357 with the same inventor and title as the present application.

STATEMENT REGARDING FEDERALLY SPONSORED RESEARCH OR DEVELOPMENT

Not Applicable.

BACKGROUND OF THE INVENTION

1. Field of the Invention

The present invention relates to electronic commerce applications using digital and analog networks. More specifically, the present invention relates to online sports betting. More specifically, the present invention relates to a method of commerce that enables users to exchange option interests in the context of sporting competition outcomes during live competition.

2. Description of Related Art

Online gambling has grown in popularity over the years. Online gambling includes activities such as online sports betting, and online casinos. Betting on mini-events during a live sporting competition has been made possible through cell phone and internet use.

Separately, online stock exchanges such as Etrade and TD Ameritrade have become popular means for buying and selling stocks online, while offering considerable limitations and risks to the common user. Considerable funds are required to operate on trade on margin inhibiting the common trader from fully exploiting an understanding of the market.

SUMMARY OF THE INVENTION

The present invention relates to an ecommerce application whereby a user registers an account that allows for debiting and crediting with a website based Controller either through a standalone website, an online casino or at an actual casino. Options are exchanged whereby an option represents a wager that the user's chosen team wins their competition or achieves the established margin of victory (commonly called the “spread”). A user can post an offer for sale of an option with said website before a sporting competition begins. Once an offer is accepted, the option becomes a negotiable security in the form of a ticket. Users can also buy and sell said options and tickets from other users before the sporting comptetition begins and during the competition. The Controller does not buy or sell options, and instead merely provides a platform for the exchange and creation of options.

Once an option is sold its value is represented by a ticket. A ticket can then be transferred to a buyer. Options that are created but never sold to a buyer are voided and the option creator does not lose any money other than a transaction fee to the Controller.

Tickets exchanged during the interim of a sporting competition (herein “intergame tickets”) may be valuated in at least two different ways. First, the Controller may provide a ticket value based on a game and sport specific formula (herein “formula value”) that is comprised of factors described in the Detailed Description section of this application. Second, the ticket holder themselves may valuate the tickets they hold (herein “market value”). Finally, a combination of the above valuation methods may be employed.

The present invention combines the entertainment value of sports betting with the vigor of the stock market atmosphere. The present business method exploits this combination in favor of users who enjoy market analysis, friendly competition, and sporting events. In effect, a market is created for each sporting competition the same way a market is created for two different exchange traded securities Like securities, the value of the sporting competition ticket price goes up and down based on a perceived value. Similarly, there are a limited number of securities available and participants can buy and sell securities from each other.

The present invention is novel from, and an improvement over standard sports betting according to the business method differences chart below:

Business Method Differences

Standard Casino/Online Sports Book Present Invention- Options Exchange Tickets are bought by a participant before a Tickets are sold by a Controller and bought by sporting competition starts and sold after a participants before the game starts and then game ends to a central bookmaker with no bought and sold between individuals after the sales during game starts Price of ticket changes based on the amount of Price of ticket is not affected by the number of people purchasing tickets either for or against people purchasing or selling tickets the team Starting ticket value and final return value is Starting ticket value and final return are priced based on the amount a user wants to spend at standard starting point (Participant can buy 1 (They can buy $100 ticket or $1 ticket) ticket for $1 or 100 tickets for $1 but they can't buy 1 ticket for $100) Ticket value remains consistent during the Ticket value fluctuates throughout the game game and only changes at the end of the game (Either $0 or value of ticket plus winning minus transaction fee)

Therefore, it is an object of the present invention to provide a novel method for conducting business wherein a user, with an interest and understanding of both sports betting and a securities market, is provided entertainment that incorporates these interests in exchange for transaction fees.

The characteristics and utilities of the present invention described in this summary and the detailed description below are not all inclusive. Many additional features and advantages will be apparent to one of ordinary skill in the art given the following description. There has thus been outlined, rather broadly, the more important features of the invention in order that the detailed description thereof that follows may be better understood, and in order that the present contribution to the art may be better appreciated.

In this respect, by explaining at least one embodiment of the invention in detail, it is to be understood that the invention is not limited in its application to the details of construction and to the arrangements of the components set forth in the description. The invention is capable of other embodiments and of being practiced and carried out in various ways. Also, it is to be understood that the phraseology and terminology employed herein are for the purpose of description and should not be regarded as limiting.

As such, those skilled in the art will appreciate that the conception, upon which this disclosure is based, may readily be utilized as a basis for the designing of other structures, methods and systems for carrying out the several purposes of the present invention. It is important, therefore, that the description be regarded as including such equivalent constructions insofar as they do not depart from the spirit and scope of the present invention.

Further, the purpose of the foregoing abstract is to enable the U.S. Patent and Trademark Office and the public generally, and especially the scientists, engineers and practitioners in the art who are not familiar with patent or legal terms or phraseology, to determine quickly from a cursory inspection the nature and essence of the technical disclosure of the application. The abstract is neither intended to define the invention of the application, nor is it intended to be limiting as to the scope of the invention in any way.

The characteristics and utilities of the present invention described in this summary and the detailed description below are not all inclusive. Many additional features and advantages will be apparent to one of ordinary skill in the art given the following detailed description.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is: a description of the Ticket value formula including Parameters, Arguments, Internal Parameters, and Step-by-step description of the formula followed by the complete formula for a Ticket value.

DETAILED DESCRIPTION

Before a sports competition begins, a predetermined value of equally priced options are made available from the Controller to registered account holders (“users”). An option is analogous to a security or a unit of stock and is purchased with the belief that the team selected will win the game or will cover the spread. A user will post an offer to sell the value of an option via the website and a buyer may accept the user's offer whereby the option is negotiated and a ticket is created for a specific value.

Pre-game options are posted by the Controller for the same starting price point amount. By way of example, a ticket is presented from the Controller to an initial seller for the unexercised value of $1 before a game starts. When the initial seller sells that $1 ticket to a buyer, the intial seller's account is credited $1 while the buyers account is debited $1 and the Controller has no property interest in the ticket but may receive a transaction fee. The seller may sell as many tickets as they have equivalent funds to cover losses in their account. The buyer may purchase as many tickets as are available at the presented price point as they have funds to cover the purchase in their account. The total amount of sales will be credited to the sellers account while the total amount of purchase will be debited from the buyers account.

The total value of the tickets purchased from a seller will be credited to a buyer's electronic account. Each ticket credited gives the buyer at the end of the game the option (which will be automatically exercised) to redeem the final value of the ticket. The ticket(s) is committed to with the belief that the team selected will win the game or will cover the spread. If the team selected wins or covers the spread the buyers account will be credited the final value of the ticket. In our example it will be credited $2 (minus the vig), the original $1 spent on the ticket and $1 for the winning (minus the transaction fee). If the team selected loses, the buyer's electronic tickets will be voided and there will be no further exchange.

The total amount of tickets sold by the seller will be logged to the sellers account. Each ticket sold gives the seller the responsibility of covering the final value of the ticket. It is the seller's belief that the team selected will lose or not cover the spread. If the team losses or does not cover the spread the original purchase price of the ticket will remain in the sellers account and their obligation will be voided. If the team selected wins or covers the spread the seller will be responsible for covering the final value of the ticket sold regardless of who is in current possession of the ticket and their account will be debited the final value of the ticket. In our example the seller will be debited $2 ($1 for the original purchase price and $1 for win).

Tickets exchanged during the interim of a sporting competition (herein “intergame options”) are valuated in at least two different ways. First, the Controller may provide a ticket value based on a game and sport specific formula (herein “formula value”) that is described in FIG. 1 and may be comprised of the below factors:

SPORT FORMULA ELEMENTS Football Time left, Spread, Possession, Field Position, Score Basketball Time left, Spread, Score Baseball Innings left, Spread, Possession, Score Soccer Time left, Score, Possession Motor Racing Laps, Laps left, position, Spread (or beginning odds) Golf Round, Hole, Score, Spread (or beginning odds)

In a second valuation method, the ticket holder may valuate the tickets they hold (herein the “market value”). It is also anticipated that a formula value is available as a default value if a ticket holder doesn't specify a price and/or that a formula value is posted as a reference for ticket holders and buyers by which each can respectively valuate their ticket price and compare ticket prices amongst ticket holders with offers or invitations to sell tickets. It is also anticipated that ticket buyers can offer or counteroffer amounts for ticket sales and that ticket holders can declare their market price as a firm offer so as to avoid getting offers or counteroffers. All transactions include a transaction fee to the Controller.

In this way, if a team is winning, a participant who originally bought the ticket of the team for a dollar will have the opportunity to sell the ticket at a higher price (based on the sport specific formula and/or market value). If a team is losing, a participant who originally bought the ticket of the team for a dollar will have the opportunity to sell the ticket at a lower price (based on the sport specific formula and/or market value). The value of the ticket sold will be credited to the sellers account (minus the transaction fee) and debited from the new buyers account. The seller will no longer have access to the tickets and the new buyer will now have the purchased electronic tickets credited to their account. As the game progresses buyers can enter the market and participate in the buying and selling of tickets via the options market. For every transaction the Controller receives a transaction fee from the seller.

The previous is a detailed description of embodiments of the present invention. As these embodiments of the present invention are described, various modifications or adaptations of the methods and or specific structures described may become apparent to those skilled in the art. All such modifications, adaptations, or variations that rely upon the teachings of the present invention, and through which these teachings have advanced the art, are considered to be within the spirit and scope of the present invention. Hence, the description is not to be considered in a limiting sense, as it is understood that the present invention is in no way limited to the embodiments described. 

1. A business method whereby: options are created that represent a wager that a chosen team will win a specific competition or at least beat the spread; equally priced options are exchanged for a ticket value between registered account holders through a Controller before the start of a sporting competition; the Controller ceases formation of options before the start of the sporting competition; registered account holders may buy and sell tickets to each other before and during the competition; the valuation of ticket prices fluctuates after the start of the competition and is established by: a formula value created by a formula; a market value proscribed by each ticket holder; a counteroffer proffered by an interested buyer; or a combination thereof; and the Controller extracts a transaction fee for any or all sales and/or transactions.
 2. The formula of claim 1 comprising: parameters comprised of: the team to give a ticket for; the upper limit of the result range; the favored team; and the spread; arguments comprised of: the score of a first team; the score of a second team; possession by said first team or said second team; and remaining game time; internal parameters comprised of: a possession point-equivalent value; a spread/possession effect up time value; a spread/possession effect sharpness value; an effort effect time exponent value; and an effort effect sharpness value; a queried ticket signum factor; a favorite team signum factor; a possession signum factor; a spread/possession effect up factor; a possession effect down factor; a measure of effort necessary for a tie expression; a result indicator expression; and a result scaled to required range expression. 